Fines imposed on manufacturers of modular expansion joints for bridges involved in a quota cartel

The Bundeskartellamt has imposed fines totalling around 7.3 million euros on two manufacturers of modular expansion joints (expansion joint systems for road bridges) for engaging in an illegal quota cartel. The companies concerned are Maurer SE, Munich, and Mageba GmbH, Göttingen.

Andreas Mundt, President of the Bundeskartellamt: “For several years the only two manufacturers in the market for modular expansion joints for bridges engaged in a quota cartel. The companies had agreed on a system of fixed market shares in the form of quotas to carve up the market between them. Compliance with the quotas was monitored by their sales staff who intervened in the case of substantial deviation from the agreed quotas. To maintain these quotas the companies split important future contracts. Furthermore, a uniform price calculation formula was agreed in order to implement the cartel. The road construction sector is an important part of Germany’s public infrastructure. The cartel thus ultimately affected investments made by the federal government, the Länder and local authorities which own the bridges.”

The Braunschweig public prosecution office is conducting investigation proceedings against the companies’ representatives on account of suspected bid-rigging agreements. The Bundeskartellamt and the Braunschweig public prosecution office, which closely cooperated throughout the proceeding, followed up tip-offs from market participants and jointly carried out dawn raids at several companies and private homes in January 2019.

Expansion joints are designed to stop bridges from bending out of place by allowing for expansion and contraction to counteract temperature fluctuations. The agreements covered contracts for the construction of new bridges as well as the maintenance and repair of existing bridges, if the latter involved the installation of a new expansion joint system. The cartel, which was characterised by a high level of organisation, covered the whole German market volume for the supply of modular expansion joint systems with only few exceptions.

According to the Bundeskartellamt’s investigations, representatives of the companies Maurer and Mageba (at that time Mageba operated as RW Sollinger Hütte GmbH) and of the former Mageba GmbH based in Uslar met on 19 October 2004 and agreed that the market shares existing at that time, i.e. the 2004 status quo, were to be maintained. It was also agreed that the companies should in future be entitled to maintain these market shares as their quotas. The agreements were implemented and compliance with the quotas was monitored during the period from 19 October 2004 until 16 January 2019 at meetings and in telephone calls between several (sales) employees of the companies. In cases of substantial deviation, “end of year meetings” were held to even out the quotas. Specific contracts that had not yet been distributed were regularly allocated to those companies which had not reached their full quotas. The representatives also divided at least the important contracts of interest to the companies among themselves in order to ensure future compliance with the quotas. In the meeting on 19 October 2004 they also agreed in principle that a price formula should be used to calculate the prices of modular expansion joints.

In setting the fines, the Bundeskartellamt took into account that Maurer SE and Mageba GmbH cooperated extensively with the Bundeskartellamt in uncovering the agreements and that a settlement could be reached. The orders imposing the fines are final.

A case summary (in German) in accordance with Section 53(5) of the German Competition Act (GWB) can be accessed here.